On January 2, 2018, Nori Mining Co. (lessee) entered into a 5-year lease for drilling equipment for$240,000. Nori estimates that the equipment's salvage value will be $20,000 at the end of its 8-year life. Forthe year ended December 31, 2018, what amnount should Nori recognize as amortization expense?A) S27,500B) $30,000C) $48,000D) $46,000

The amortization expenses needs to be computed on the cost of the asset which is divided by the…

Answered: On January 2, 2018, Nori Mining Co.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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At January 1, 2023, Tiger Company leased restaurant equipment from Best Corporation under a five-year lease agreement in a finance lease. The lease agreement specifies annual payments of $100,000 beginning January 1, 2023, the beginning of the lease, and at each December 31 thereafter through 2026. The equipment was acquired recently by Best and was expected to have a useful life of six years with no salvage value at the end of its life. Best seeks a 3% return on its lease investments. The amount of lease liability reported on December 31, 2023 balance sheet by Tiger would be: Present Value of Ordinary Annuity of $1 Period 5 6 O $283,204 $282861 O $285,861 O $284,275 3% 4.57971 5.41719 6% 4.21236 4.91732 7% 4.10020 4.76654 8% 3.99271 4.62288 3% 4.71710 5.57971 Present Value of Annuity Due of $1 6% 4.46511 5.21236 7% 4.38721 5.10020 8% 4.31213 4.99271
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Maris Co. purchased a machine on January 1, 2021, for $2,500,000 for the express purpose of leasing it. The machine is expected to have a five-year life, with no salvage value, and be depreciated on a straight-line monthly basis. On January 1, 2021, Maris leased the machine to Dunbar Company for $750,000 a year for a four-year period with an implicit rate of 6%. Payments are due to Maris on January 1 of each year starting in 2021. This is an operating lease from the lessee perspective. a. Create the journal entries for the lessee, Dunbar, for January 1, 2021 b. Create the journal entries for the lessee, Dunbar, for December 31, 2021.
8. Michael Company leased equipment to Hay Corporation on July 1, 2012 for an eight- year period expiring June 30, 2020. Equal payments under the lease are P600,000 and are due on July 1 of each year. The first payment was made on July 1, 2012. The cash selling price of the equipment is P3,520,000 which reflects its present value, and the cost of the equipment on Michael's accounting records is P2,800,000. The lease is appropriately recorded as a dealer's lease. What is the amount of the resulting gross profit from this sale at the inception of the lease? * a. P45,000 O b. P90,000 O c. P720,000 d. P1,280,000
Bb.38.
Ray is a finance director in a public sector organization that has experienced difficulty attracting and retaining skilled staff. To assist in overcoming this problem, the board has engaged a consultant to recommend an improved benefits structure, to apply to all staff. The consultant has produced his report, and Ray has been asked to consider the proposed staff benefits structure, and make appropriate recommendations to the board. He study the report, conduct appropriate research, and assess the costs involved. He concludes that it will be necessary to increase staff costs, but believes these will be offset by the efficiencies brought about by recruiting and retaining high-quality staff. The report contains the following recommendations: Benefits should be related to the length of service of members of staff. After one year of continuous employment, a member of staff will qualify for private health insurance. Private health insurance should cover the member of staff and his or her…
Approaches to uture is commonly known as anaging changes to organitional processes and their structures and ther impact on staff and a Communication b. Change Management C Management Culture d. Business transformation E-change Management The number of sbordinates who report directly to an eecuive or supervisors known as the a Locus of control b Division of labor C degree of standardization d. Degree of specialization span of control
s
Q3) 3. The company will invest $150,000 in a project and average annual income $50,000. The investment will provide the following inflows: Year Cash inflow 1 $ 25,000 2 45,000 3 30,000 4 50,000 5 70,000 Calculate: Net present value at 10% discount factor. Payback period

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